Sears ups store count through Wal-Mart, Kmart deals
September 29, 2004-- Home Textiles Today,
TROY , Mich. – Sears will acquire six off-mall locations from Wal-Mart, in addition to gaining 50 locations from Kmart.
Sears will make lease payments to Wal-Mart under subleases for the Wal-Mart stores which are located in mid-size markets.
Sears is also buying 50 stores from Kmart for $575.9 million, including $172 million in net cash proceeds to be received during the current quarter.
With this transaction, Sears is doubling its total number of stores in San Diego , adding five new stores to the New Jersey market and increasing the total number of stores in Florida , the Northeast and Puerto Rico .
"The completion of this transaction moves Sears another step closer to its strategic goal of growing our store base and the Sears brand off-mall," said Alan Lacy, Sears chairman and CEO. "We look forward to an increased presence in these key markets and serving new and existing customers."
The balance will be paid when Sears takes possession of the stores, no later than April of 2005.
As reported in HTT on Sept. 2, the companies had stated the deal would call for Kmart to sell 45 stores for $524.5 million in cash to Sears.
Kmart will continue to operate the stores sold to Sears until March or April 2005, with the exception of the West Palm Beach , Fla. , store which will transfer this fall. Sears has agreed to consider offering employment to any Kmart employee who desires a position at the converted stores.
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